Markets Ignoring Inflation, War & Reality? | David Roche Warns Of A Dangerous Bubble

Ajouté : 2026-05-31

[00:00:00]and talk to David about what he was just saying. $107 per barrel is what the rates in the physical market are. David, earlier on in the conflict though, they were closer to 140. So, this is significantly better, is it not? And directionally moving in the right direction.

[00:00:17]>> It's definitely badly bad.

[00:00:20]But, it is not better than where we were at 60.

[00:00:24]So, if you take 60 to uh what are we talking about? 107 in the physical market, then you haven't seen the full impacts of this on your groceries, your bread basket, your FedEx delivery, or anything else you buy in life, including the energy to make the steam that goes into your coffee in Starbucks. So, essentially, no, it's not good. Uh good is below 70.

[00:00:48]Now, I will tell you one thing, it's not as bad as it could be.

[00:00:52]And as you know, if nothing changes, nothing changes in the Gulf, you still go on getting four tankers a day going through the Gulf, then essentially, you're going to run out of oil inventories in 10 of the 15 major economies by the end of the summer. And at that point in time, you're dead right, 107 is going to look good gets wiped because the oil price is going to be 150.

[00:01:18]>> Well, you know, but what's happening with oil and geopolitics and what's happening with markets is quite something else. And you just just put up this statistic, right? So, just before I go to David for his next question. Guys, I don't know if you if if you know, I read this and that's why it came to my notice, but Dell, of course, was up 30%, but Trump on May 8th had told everyone to go out and buy Dell.

[00:01:41]Now, the results came out. Dell was up 30% from May 8th till now, Dell is up uh I I think 120% or thereabouts. Like I I or 80%, sorry. I stand corrected, not 120, but 80% in 20 days. So, I think in some in some sense, maybe in his mind he's saying, "Oh, Nasdaq is up 30% from 2 months. Dow is up 20% in the last 2 months. What am I saying is happening in the markets? Therefore, I'm on the right footing." Markets are on a completely different path independent of what's happening to inflation, war, and everything else. At least the US markets.

[00:02:11]>> Oh, the US markets definitely are. And the point I was making about Anthropic, its valuation is now 965 billion dollars. And Trump doesn't like that company. So, Trump may be one factor, but something else is going on there. I don't know if it's a super cycle, it's a bubble, or what it is.

[00:02:29]>> Yeah, David, so what happens? I mean, US markets are drawing in all the flows from across the world right now, and maybe select other markets in Taiwan and Korea. But when does this unravel, if it does?

[00:02:43]>> Well, it really depends on, I'd say, two things.

[00:02:46]Number one, if the gulf is not resolved, then you're going to have a very, very serious economic problem. And the problem will be not the price the price of gas at the pump will cost a lot. The problem will be there is no gas to be had at the pump.

[00:03:03]And the economies are coming unstuck. At this moment in time, the equity markets cannot continue to rise because the inflationary consequences will imply interest rates which hit their multiples, and the economic performance will destroy their profits.

[00:03:19]>> [snorts] >> But first, you have to get to that point. You're not there yet. For the moment, you're in what I call a period of suspension of credibility.

[00:03:29]It's a period when all those involved in tech, everything that goes into tech tech, the electricity that goes into tech, everything tech, and also the hard products which go into tech from places like Cambodia, Korea, they believe they exist in an economy which does not depend on such macro things as inflation, cost of capital, GDP growth.

[00:03:52]They believe they are in a suspended state of excitation and that they have no relation to such nastinesses as we are talking about.

[00:04:02]Okay, that can go on for as long as the interconnect between the bad things we're talking about and the froth in the equity market, as long as it does not connect.

[00:04:14]If we go forward and the gulf resolves itself, then I don't know where we're going to go. But we're beyond the moon.

[00:04:21]>> Right.

[00:04:21]>> do not and this comes unstuck, then we all come unstuck.

[00:04:25]>> Mhm.

[00:04:26]All right. Well, let's see how that goes. David, thanks so much as always for taking the time. It's a pleasure speaking with you.